State Legislature Opens January 19, 2011 Amid Continuing Budget & Economic Crisis
26th Legislature Opens January 19, 2011
From the January 2011 Small Business News
The 26th State Legislature convenes on Wednesday, January 19, 2011, at 10 am in the State Capitol. It is the start of the regular 60 working day session which is scheduled to adjourn on May 1.
There will be more of a traditional opening than last year but still not as fancy as in years past. The reason? The continuing budget and economic crisis that grips Hawaii after three successive years.
There is a new Democrat Governor and Lt. Governor-Neil Abercrombie and Brian Schatz-but the problems that plagued the final days of the Linda Lingle Administration are still present.
The Democrats still control the Legislature by a wide and decisive margin-unlike most other states on the Mainland — 43 of 51 in the House and 24-1 in the Senate. That’s right, 24-1!
There are several new faces around the Capitol this year.
In the Senate, Maui Senator Shan Tsutsui is the new Senate President, succeeding Colleen Hanabusa who was elected to Congress. The Senate organized in days after the November 2 election.
Calvin Say is back as Speaker of the House after a two month struggle to retain his leadership in the House. He has a significant number of Democrats still opposed to him.
For business, the problems keep getting larger. Hawaii is one of 33 states now borrowing unemployment compensation funds to pay its monthly UI bill. UI rates will increase on business dramatically again this year putting a further damper on new hiring, especially among small businesses. No employee pays any part of the UI tax.
There will be an early thrust by the unions to further increase the state’s regressive General Excise Gross Income Tax, not a sales tax, currently at 4.5% on Oahu, or equal to about a 17% sales tax.
Problems with the state public worker health fund (EUTF), and under funded State Employees Retirement System (ERS) will continue to be a drag on the economy.
The debt of the state hospital system, growing demands for health care and social welfare subsidies will all be on the early agenda of this session.
More details online and next month’s SB News.